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_gabrielShapir0
@lex_node
This is the main Tether thing that always worried me. That they could just mint USDT for certain customers without a corresponding deposit. This is basically lending USDT on an unsecured basis & could result in market manipulation by the recipients.
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Bennett Tomlin
@BennettTomlin
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We also learned that Tether started using commercial paper and other assets as part of their reserves much earlier than we had previously known. It also revealed that they would give their clients Tethers before they had actually received the wire
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Jesse Powell
@jespow
Did they say the advances were unsecured? Wires can be called back even after they land. Nothing is ever “settled” in fiat banking. I don’t understand the manipulation comment. Anything *could* result in “manipulation” (whatever that means) but how is this setup special?
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Benjamin Adams
@BenAdamsO_O
My firm has received literally billions of dollars in wires over the last two decades and I've never had one called back. And I've never been able to call one back. 🤷‍♂️
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Oscar D Þorson 🇺🇦
@odtorson
that’s not the point though; the question here is whether Tether customer sends dollars or dollar promissory notes aka commercial paper, possibly cross collateralized by crypto holdings
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Benjamin Adams
@BenAdamsO_O
Yes I understand that part but the idea that nothing is ever settled in fiat banking is wrong. Warnings about wire fraud are absolutely ubiquitous in my industry right now. That's because once the wire is gone it is gone.
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Benjamin Adams
@BenAdamsO_O
Replying to
@jespow
@odtorson
and
@lex_node
I suppose every rule has caveats (hence the 🤷‍♂️) but I've done billions in wires and never seen one recalled and I've also seen lots of fraud that couldn't be undone. All the resources I can find indicate that you cannot recall a wire once it lands but perhaps they're all wrong...
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Benjamin Adams
@BenAdamsO_O
Moreover every time I've received a wire in error, the initiating party has had to contact me and request a wire back. If reversals of wires that have landed are indeed common, it is the best kept secret around. (It's a mostly tangential point either way.) Cheers.
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